4.18.24 Movement Legacies, Reflection, and Review.pptx
2012 Reenergize the Americas 2A: Jesse Thompson
1. How Shale is Impacting the Texas Economy
Extraction Chemicals
Refining
2. After 30 years of decline,
Jan 1981=100 tight oil drives production growth
120
New Mexico
110 U.S.
Texas
100
90
80
70
60
50
40
30
Jan-1981 Jan-1985 Jan-1989 Jan-1993 Jan-1997 Jan-2001 Jan-2005 Jan-2009
SOURCE: Energy Information Agency.
3.
4.
5. Oil and gas revenues impact a variety of state taxes
Severance taxes
Sales taxes on energy equipment
Retail sales in energy regions
Sales tax collections up 10.1% in July from July
2011
State wide oil and gas severance taxes up 61% in
first six months of this fiscal year to $1.8
UTSA study: in 2011 EF generated $312 million in
state taxes
6. 30 Bone Springs Barnett
10
25 Real Weekly Wages
Real Weekly Wages
20 Avg Emp
Avg Emp
5
15
10
0
5
0
-5 -5
2006 2007 2008 2009 2010 2011 2012 2006 2007 2008 2009 2010 2011 2012
Spraberry Wolfcamp Eagle Ford
20 10
Real Weekly Wages Real Weekly Wages
10 Avg Emp Avg Emp
5
0 0
-10 -5
-20 -10
2006 2007 2008 2009 2010 2011 2012 2006 2007 2008 2009 2010 2011 2012
*Growth rates are year-to-year. Adjusted with U.S. chained Personal Consumption Expenditures index deflator.
SOURCE: Quarterly Census of Wages and Employment; Bureau of Labor Statistics
7. Oil rises while shale and weather crush natural gas
12
Oil/Gas*
10
8
6
4
2
0
Jan-1974 Aug-1979 Mar-1985 Oct-1990 May-1996 Dec-2001 Jul-2007
*Refiners acquisition cost of imported crude / natural gas wellhead price (BOE).
SOURCE: Energy Information Administration. Author's Adjustments.
8. Planned expansions and new facilities in Gulf Coast
could increase U.S. ethylene capacity by nearly 30
percent by 2017
More pipelines and fractionation capacity are also
being added
Two large TX refineries recently announced
expansions
9. the U.S. becomes a net exporter of gasoline and diesel
Exports of Product Triple Diesel & Gasoline net imports plunge
4000 1500
3500
1000
3000
500
2500
0
2000
-500
1500
-1000
1000
Distillates
500 -1500
Finished Motor Gasoline
0 -2000
2000 - Jan 2003 - Jan 2006 - Jan 2009 - Jan 2012 - JanJan-1974 Sep-1983 May-1993 Jan-2003
SOURCE: Energy Information Agency.
10. Cents/lbs Divergent Oil & Gas Prices lead to rise Ethane advantage
60
50
40
30
Ethane
20
10
0
-10
-20
Naphtha
-30
-40
Jan-1997 Oct-1998 Jul-2000 Apr-2002 Jan-2004 Oct-2005 Jul-2007 Apr-2009 Jan-2011
SOURCE: Muse, Stancil, and Co Ethylene Cash Margins. Author's adjustments.
11. 2011 Nameplate 2011 Ethylene Feedstock Mix*
Capacity 1.0
NGL
Area tonnes/year 0.9
Naptha
0.8
Asia 29,242,000 Gas oil
0.7
Other
Middle East 24,059,000 0.6
0.5
United States 27,593,206
0.4
Western Europe 24,384,000 0.3
0.2
0.1
* Percent of capacity reporting feedstock usage for each
0.0
region was: Asia-82%, ME-46%, U.S.-99%, WE-89%, ROW-
56%. 73% of global capacity reported feedstock use. Asia Middle United Western
SOURCE: 2012 International Survey of Ethylene Steam East States Europe
Crackers. Author's calculations.
12. Company Location Capacity Start-Up
(mm lb/yr)
Dow Chemical US Gulf Coast 4,200 2014-2017
Ineos Lake Charles, LA 3,000 2018
CP Chem Baytown, TX 2,500 2016/2017
Braskem/Idesa Mexico 2,200 2015
Shell Chemical Northeast US 2,000 2016+
Formosa Point Comfort, TX 1,760 2015
LyondellBasell Texas, Illinois 1,450 2012-2014
Dow Chemical Hahnville, LA 800 2012Q4
Williams Lake Charles, LA 600 2013Q3
Westlake Chemical Lake Charles, LA 230 2012
Ineos Chocolate Bayou, TX 230 2013
Source: Chemical Week, December 2011
13. The Eagle Ford
Special thanks to Dr. Keith Phillips.
Senior Economist, San Antonio Branch of the Federal Reserve Bank of Dallas.
14. Millions of barrels
100 92.8
(projected)
90
80
70 Gas production
(barrels of oil equivalent) 51.2
60
(projected)
Oil production
50
NGL production
40
24
30 (projected)
20
10
0
2009 2010 2011 2012
Source: Texas Railroad Commission
15. Lease payments $7.5 billion, 2007 - 2011
Royalty payments $5.2 billion, 2007 - 2011
Total EF personal income in 2009 was about $23.0
billion, $12.2 billion without Webb and Brazos counties
16. Annualized job growth
(percent)
30
25
Mining
20
General freight trucking
15 Pipeline transportation
10
5
0
Corpus Christi Houston San Antonio
Source: Texas Workforce Commission, Author' s calculations
17. Rig count in slow decline on oversupply of gas and gas liquids
Number
2,500
Gas directed
Oil directed
2,000
1,500
1,000
500
0
Jan-2008 Jan-2009 Jan-2010 Jan-2011 Jan-2012
SOURCE: Baker Hughes
Notes de l'éditeur
-
Exports of US refined products have grown rapidly in recent years. -- Exports are a product of (1) excess US capacity, (2) weak domestic demand, and (3) strong demand from developing countries -- Refiners experienced good profits during the last decade, and invested in expansion of existing plants. Between 2000 and 2010, domestic refining capacity grew 14 percent. -- The run-up in oil prices from 2003-2008 discouraged domestic consumption of oil products. US oil consumption is down 3.2 percent since 2000. -- Rapid growth in the developing world led to strong foreign demand for oil, and exports from the Gulf Coast grew 166 percent between 2000 and 2010, to over 2 million barrels per day. -- The Gulf Coast accounted for 78 percent of US petroleum product exports by 2010
